Auto Leasing Slows

According to CNW Marketing Research, during the last ten months of 2000 personal-use leases accounted for 29.0 percent of total unit sales of autos and light trucks, down from 32.5 percent during the same period in 1999. In the most recent period, leasing of autos amounted to 27.6 percent of industry car sales, while leasing of light trucks accounted for 30.6 percent of sales of trucks. As usual, the proportion of leased vehicles was highest for luxury cars. For example, 69.7 percent of Cadillac truck sales and 63.8 percent of Jaguar cars were financed with leases. In contrast, only 18.6 percent of the sales of Mercury cars and 18.2 percent of sales of Saturn cars were financed in this manner.

With certain exceptions, CNW anticipates somewhat higher residual losses in 2001 than in 2000, up from an unweighted average of $1,365 per unit to $1,429 in 2001. However, they anticipate a slight decline in residual losses on luxury sport utility vehicles. As consumers pull back from buying new SUVs, they will turn to two- and three-year old vehicles. As a result of their bidding up the prices of those vehicles, residual losses will decline. Similar economic forces will help to curb residual losses on other "near luxury" vehicles.